Govt supports value chains to boost economic growth
GOVERNMENT says it will be identifying more quick win value chains in agriculture, mining and manufacturing sectors to support the country’s economic growth in 2023.
Value chain transformation as enunciated by National Development Strategy 1 (NDS 1) is considered a viable catalyst to the realisation of the envisioned upper middle income by 2030.
The thrust of the initiative is to enhance local value chains performance in order to improve the production of local goods to curb imports, at the same time stimulating the linkage of Small and Medium Enterprises with large corporates.
This endeavor has already seen the Treasury allot US$30 million Horticulture Export Revolving Fund (HERF) which is anticipated to support the sustenance and innovation in the sector that significantly contributes to the country’s export earnings.
The financing is mainly designed to promote the sector’s activities like freezing, canning, bottling, extracting, juicing, and concentration of various horticultural products.
As enunciated in the 2023 national budget support initiatives will also be directed towards livestock production through the distribution of animal stocks to rural farmers as seed capital meant for empowering rural communities.
In that regard an amount of $6, 6 billion has been allotted for the rehabilitation of dip tanks, surveillance, and control of animal diseases.
The mining sector is expected to grow by 10, 4 percent in the coming year, steered by sustained promising global mineral prices.
As such, the government indicated that it will be chaining out initiatives like Mining Industry Loan Fund that will be used for supporting artisanal and small-scale miners by availing mining establishment loans and equipment hire loan schemes.
“The desired structural transformation from a commodity-driven economy, into a diversified resilient economy is being achieved through interventions which promote value addition of primary commodities, diversify the local product range and exports, as well as the adoption of innovative technologies.
“Consumption of locally manufactured goods creates greater benefits through tax revenue for Government, employment, entrepreneurship and skills development among other benefits. However, this requires local manufacturers to produce products that compete with imports on price, quality, and reliability,” said Finance and Economic Development Minister Professor Mthuli Ncube in his 2023 budget presentation.
The treasury chief also indicated that the government seeks to accelerate the structural transformation of the manufacturing sector with a view to improving value-addition capacity and diversification of the local product range.
The manufacturing sector has been witnessing growth since 2019, with capacity utilisation steadily growing to current levels of about 66 percent while domestic products have grown to improve their occupancy on the shelves of local supermarkets.
To support the growth, the Government in 2022 launched a US$22,5 million kitty for the manufacturing sector with fertiliser and other agro-processing activities receiving US$7,5 million while cotton, leather, and pharmaceutical value were allotted US$5 million apiece. Positively, the government this year received support from the African Development Bank (AfDB) in support of value chain initiatives through the Sustainable Enterprises Development for Women and Youth Project, disbursing US$960 000 towards strengthening of fruits and Vegetables Value Addition Centre in Hauna and Mutasa districts of Manicaland and, for the development of architectural designs and the upgrading of the Mutoko Royal Fruits and Veggies (Private) Limited.
The funding was also directed towards drafting of the mineral development policy, the Minerals Beneficiation, and Value Addition Strategy as well as the artisanal and small-scale mining strategy.
In 2023, the AfDB is expected to further disburse US$1,4 million towards projects promoting entrepreneurship amongst youth to reduce youth unemployment and gender inequality.
-herald.clz.w
